Forum Rules (Everyone Must Read!!!) (updated: 04/28/2015)

Welcome to the Bankruptcy Forum. Bankruptcy (BK) Forum is known as and will be referred to as BKF hereinafter. In order to ensure a long term success of our vibrant community, we have established certain rules and guidelines to which everyone must adhere to. Please take your time to carefully read our rules, before you start to participate in the community.

Things you agree to do: (BKF) users agree to use the search function before starting a new thread. This prevents duplicate discussions and allows for better organized topics.

All BKF users agree to read the sticky posts which may be available at the top of a forum page. These Sticky posts often contain valuable information. They may also outline more rules and guidelines specific for that particular forum, stickies are put in place by that forums moderator(s) or admin(s).

Things you agree not to do:

All BKF users agree not to call people names or write a post simply to make a personal attack, or get a negative reaction; this behavior is not allowed on our forum. The use of derogatory language aimed at anyone will be severely dealt with. There is no need to agree with each other, or to even like each other. However, by signing onto you agree to treat each member and guest with the respect they deserve. No threats or personal attacks will be allowed.

All BKF users agree not to discuss, engage, or encourage any behavior or activity which violates the law. Discussion of drugs, violence, murder, theft, vandalism, fraud or any other issue which could be used to help individuals break the law is strictly forbidden.

All BKF users agree not to "bump" old threads, unless there is a specific benefit to the community by doing so. But in most cases, please don't post in very old threads, instead start new threads.

All BKF users agree not to attempt/use another members account. It is against BKF rules to use any account other than your own. Impersonating another member will result in an immediate ban. It is also against the rules to open more than one account in your own name without permission from a moderator or administrator. If you have been banned for any reason, it is against the rules to open another account. If you were banned temporarily and you are caught using another account you will be banned permanently. Choosing a moniker which is similar in either sound or spelling as a moderator or administrator is strictly forbidden.

All BKF users agree not to private message any moderator, admin, or other member with questions related to their personal circumstances (Questions about the forum or issues with the forum are ok). This forum only works when members share their experience and insights with everyone.

Things you agree not to post:
All BKF users agree not to post any derogatory/racist/or sexist remarks. This includes attachments, links and all information contained within posts, signatures, and avatars, failure to comply with this rule will result in a permanent ban.

All BKF users agree not to post any copyrighted or trademarked information without the express written permission of the owner(s) / proper citation of source.

All BKF users agree not to post any real names, addresses, telephone numbers, email addresses, social security numbers, or any other personal details (their own or other people's).

All BKF users agree not to post links, pictures, attachments, videos, or the like of pornographic content, objectionable material or extreme violence, whether cartoon or real.

All BKF users agree not to use BKF for advertising purposes without a written contract between yourself/company/agent and the administration of BKF. Blatant advertising will result in a ban.

All BKF users agree not to spam the forums. Spam includes but is not limited to posting erroneous, non-relevant-useless, off-topic, or meaningless posts. Spam may also include posts which contain no text, or large areas of blank space between lines. Simply posting emoticons without text is considered spam. BKF is the largest bankruptcy message board and all the content is intended to help other users. Please help us improve the quality of our forum by making sure that your posts are well-worded, spell checked, grammatically correct and syntaxed.

Regarding actions of moderators and administrators:

The forum is no place to air out your opinion or be judgmental of our staff and its capabilities.

All BKF users agree not to abuse or mistreat moderators or administrators. It is against BKF rules to post any information regarding bans or any other action taken by a member of the moderating or administrative team. If you wish to discuss bans or warnings please do so via PM. To place a complaint against a moderator, send a PM to a super moderator. All Moderators are equal, any decision made by a moderator must be adhered to. If a moderator tells you something you do not like, do not go to another moderator looking for a different answer. If you are caught doing this you will be banned. The moderators work as a team and respect the decisions made by their peers and will help enforce them unless an administrator tells them differently.
If you have an issue with how the forum is run, then notify one of our administrator and we will look into the situation. We have in the past and still do appreciate any input that you offer this forum. But critical input and/or judgmental postings towards the staff will result in you getting banned.

Should you find a thread offensive or out of line, then notify a Mod in a PM so they can evaluate the situation and do the action deemed necessary.

All moderators do have active "other" lives outside of the forum and help moderate this forum in their spare time throughout the days and weeks.

If you have a problem with a member or Mod follow the proper channels of reporting it.

BKF reserves the right to delete any posts which contain anti-BKF comments or discussion. Any bashing of moderators or administrators, or any of their discussion or actions will also be deleted, and the responsible posting party(s) will be banned. Any public anti-BKF advertising, communication, or posts on another forum will result in permanent bans as well.

All warnings and bans are decided by individual moderators and administrators. Warnings are preferable to bans however, for serious offenses and repeat abusers bans will go into effect. The length of the bans can vary from several hours to permanent.

All messages posted or sent including through PM are the property of

All BKF users agree not to advertiser on the forum (Niether by posting, private messaging or using your signature). If you are a company/attorney/legal adviser wishing to advertise on the site or sell a product, you must contact the head administrator and inquire about our advertising packages.

All bankruptcy related opinions expressed on are those of their authors and not necessarily of BKF, its staff or representatives.

You agree not to copy any material/post/content from BKF without written permission from our head administrator .

By posting on this forum you agree to these terms and conditions, including any punishment deemed appropriate by moderators or administrators in the event of an offense.

Administrators/Moderators can change these rules at any time without prior notice.
See more
See less

Bankruptcy "Stay Process" Violation?

  • Filter
  • Time
  • Show
Clear All
new posts

  • Bankruptcy "Stay Process" Violation?

    Important, if a vehicle is "voluntarily surrendered" back to the bank can the bank sell the car at auction even without obtaining approval from the BK trustee?

    My understanding, regardless the bank must file a motion to obtain approval from the trustee to sell the vehicle, being it's part of the bankruptcy estate. Reason I ask, car is scheduled for auction this week however confirmed bank never even filed a motion with the court.

  • #2
    True, they can not sell it if your case has not been discharged. Otherwise, if the case has discharged and the Trustee abandoned all assets (no asset case), then they don't have to obtain permission via a Motion for Relief from the Automatic Stay. Besides, I think only the Trustee may have recourse (a cause of action) since it would be property of the estate.

    When is your discharged scheduled?
    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
    Status: (Auto) Discharged and Closed! 5/10
    Visit My BKForum Blog: justbroke's Blog

    I am not an attorney. Any advice provided is not legal advice.


    • #3
      BK discharge is not for 1 month, middle of July.

      Today, confirmed the car is scheduled for auction this Friday, June 17. Confirmed with Wells Fargo Bank, bankruptcy department. Also called the car auction company, confirmed it has a scheduled date of auction of this Friday too. However, in speaking with my BK attorney and in looking on all the screens for Pacer, Wells Fargo never even filed any motion, Relief of Stay. My "assumption," Wells Fargo BK dept. figures since the car was voluntarily surrendered they can just sell it prior to discharge. Interested to know what recourse, or penalties Wells Fargo would incur for violation of the Stay Process.


      • #4
        I don't believe that YOU have recourse since your statement of intentions was to surrender, and you in fact surrendered. The only "cause of action" (or recourse) would be from the Trustee. If your discharge is in 30 days (1 month), then 30 days has elapsed since your first scheduled 341 Meeting. (I'm assuming that was your first "scheduled" 341 Meeting.) As such, the lender would be able to sell the collateral 45 days after the 341 Meeting.

        I think that the creditor would only be in trouble by the Trustee and only the Trustee has any rights, unless you suddenly decide to redeem or reaffirm prior to the expiration of the 45 day period.

        In other words, they are treading on thin ice! I don't think that you have any personal right to seek a violation/contempt order, but the Trustee certainly does, but only if the Trustee provides adequate protection and had you surrender the vehicle to the Trustee; as clearly outlined in 11 USC 521.

        11 USC 521(a) (hanging paragraph) If the debtor fails to so act within the 45-day period referred to in paragraph (6), the stay under section 362(a) is terminated with respect to the personal property of the estate or of the debtor which is affected, such property shall no longer be property of the estate, and the creditor may take whatever action as to such property as is permitted by applicable nonbankruptcy law, unless the court determines on the motion of the trustee filed before the expiration of such 45-day period, and after notice and a hearing, that such property is of consequential value or benefit to the estate, orders appropriate adequate protection of the creditor's interest, and orders the debtor to deliver any collateral in the debtor's possession to the trustee.
        Now, it's a game and since I'm pro se, I might want to dabble in this, but you have already decided to surrender the vehicle and did do so. If you're looking to "earn" some money by filing a motion seeking damages for violation of the stay... it's s stretch.
        Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
        Status: (Auto) Discharged and Closed! 5/10
        Visit My BKForum Blog: justbroke's Blog

        I am not an attorney. Any advice provided is not legal advice.


        • #5
          The scheduled date for auction is this Friday, June 17 (37 days) from my initial 341 Hearing.

          Previously, bank refused to negotiate and compromise on a settlement agreement. So, in turn vehicle was voluntarily surrendered. Once educating myself to the 722 Motion for Redemption considering this option. Also, that the trustee uses various factors in considering the AS IS value for a car. N.A.D.A and Kelly Blue Book are to be used as a guide, not as a set in stone value. Also, the creditor/debtor's value judgement will be subjective (i.e wear, tear) as well as objective (i.e. cost to repair the vehicle damage, mechanical breakdown or body damage). The trustee is to consider all facts relevant to the determination of the value.

          Is there a cutoff point for filing a Motion 722? I have faxed Wells Fargo BK dept. to re-consider a settlement, asked them for their best offer. Also, that if they still refuse to compromise then will have my attorney file a Motion 722, BK Trustee make the car value determination. I was not certain if this needs to be filed within 45 days after the 341 hearing, meaning within 8 days or so, since currently been 37 days. Or, if the motion can be filed up to the date of BK discharge.
          Last edited by 1richard1; 06-14-2011, 09:13 AM.


          • #6
            11 USC 521 requires the debtor to take action on what their intention is... within 45 days of the 341 Meeting. So, yes... you need to file the Motion! I think that you are indecisive at this point and are trying to figure out what you want to do, but now you have the looming Friday sale. I would try to get this all in order well before Friday; perhaps as early as tomorrow.

            Do you have all your Redemption financing in place? Is this what you really want to do (redeem)? What's your end game?
            Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
            Status: (Auto) Discharged and Closed! 5/10
            Visit My BKForum Blog: justbroke's Blog

            I am not an attorney. Any advice provided is not legal advice.


            • #7
              JB it has been a long time since 341. I have a gut feeling our OP wishes to cause the bank a bit of trouble more than the desire to redeem the auto. Why did the OP not "pay through"? Why was the car willingly forfeited? All depends on your last question, does the OP have cash in hand to 722 and if so, best get on it as the Trustee (perhaps his lawyer as well) can only attempt the stop of the sale. 'Hub
              If I knew it all, would I be here?? Hang in there = Retained attorney 8-06, Filed 12-28-07, Discharge 8-13-08, Finally CLOSED 11-3-09, 3-31-10 AP Dismissed, Informed by incompetent lawyer of CLOSED status, October 14, 2010.


              • #8
                You're very much accurate, in your thoughts.

                Depending on the settlement $$$ amount: I have done research online, 722 Redemption financing. Essentially they'll pay Wells Fargo the settlement amount, transfer title to them. I've spoken with a couple companies, yet have held off thus far. Or, if Wells Fargo would actually provide a settlement agreement within reason then would personally pay them. I don't think the actual payment to Wells Fargo would transpire till "after" the trustee makes the final determination as to the value, or approves the 722 Motion of Redemption. But yes, agree need to have lined up how I'll handle this.

                My attorney wants $995 "up front." Says court fee and his fee to file the Section 722 Motion. Any other options on this, such as using an outside attorney to file the motion? Attorney has been reluctant all along on filing the motion, little advice and info. provided on filing for a redemption. Took doing research myself online and on the BK forums.


                • #9
                  Originally posted by AngelinaCatHub View Post
                  JB it has been a long time since 341. I have a gut feeling our OP wishes to cause the bank a bit of trouble more than the desire to redeem the auto. Why did the OP not "pay through"? Why was the car willingly forfeited? All depends on your last question, does the OP have cash in hand to 722 and if so, best get on it as the Trustee (perhaps his lawyer as well) can only attempt the stop of the sale. 'Hub
                  Owned vehicle for 4 years, never a missed payment till after bankruptcy filed since the engine ceased. Correct, engine and car non operable and in discussions with Wells Fargo BK dept. they refused to compromise on a settlement figure. They said the Fair Market Value is $14,750 (approx.), I offered them both verbally and in faxed documentation to their BK dept. a settlement of $4,000. Also, to please advise as to their best offer. They refused to do this, advised me they can sell the car at auction even without an operable engine for closer to $10,000. However, I've even faxed both my attorney and Wells Fargo BK dept. the documentation from the dealership "service manager" 2 spread sheets with a line by line breakdown of a new engine, parts, labor and CA sales tax.

                  I elected to voluntarily surrender the vehicle, as Wells Fargo refused to compromise. The 341 hearing was 37 days ago, and since this timeframe have become enlightened about the 722 Redemption Process. I DO have the desire to redeem the car, yet #1 issue is at what amount??? This is the end game, settlement dollar amount for the car. To date, bank refused to compromise. However, come to the realization the BK judge will make the final value determination. My attorney said he'd file the motion however can not make any guarantees, nor even offer any inclination as to the value.


                  • #10
                    The Trustee does not make a determination of value. Only the judge can do that. This is why you file a Motion to Redeem. The process is very specific and is there for a reason. This is all very time sensitive.

                    It appears that you hired an attorney at a very cheap rate that did not include any "special" services, such as special motions or even redemption. This is why the attorney wants to charge you more. You could do it yourself (pro se), but you are really late to this game. People who are doing redemptions usually file within a week of filing. (I filed my Motion to Redeem the SAME day that my case was converted to Chapter 7.)

                    You're in a tough position right now. Again, you could try to do this on your own and file the Motion and serve it (properly) on the creditor and Trustee. Depending on procedure in your court, you may need to request a hearing (and schedule it yourself by calling the Clerk of the Court to schedule). Scheduling may need to be done "before" you even serve and file the Motion (District procedural dependency).

                    I'm not saying it's impossible, but you're in a tough position to change your mind this late. The creditor will probably scream foul and that you prejudiced them by waiting so long (and changing your mind). You have the right to change your mind, it's just the timing that's going to be a "procedural" issue for you. Especially since you have an attorney and probably won't be using your attorney.

                    Have you done the math? What's the FMV of the vehicle (based on "rough retail")? How much do you still owe (balance on loan)? How many months are left on the loan with the current lender? What's the percentage rate that you pay the current lender? Percentage rate to 722Redemption? Again, have you done the math?
                    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
                    Status: (Auto) Discharged and Closed! 5/10
                    Visit My BKForum Blog: justbroke's Blog

                    I am not an attorney. Any advice provided is not legal advice.


                    • #11
                      FMV is $14,750 per Wells Fargo Bank

                      2 page spread sheet, line by line breakdown from dealership service manager:
                      $7,939 (Engine replacement)
                      $2,677 (Labor fees) Remove current engine, install replacement engine
                      $694 (CA sales tax)

                      Both Wells Fargo Bank BK Dept. and my attorney have had all this documentation for approx. 1 month, vehicle became inoperable just a few days after my 341 hearing. Bank says they'd sell car at auction, informed me the balance remaining from sell of vehicle at auction would be a write off through the Ch. 7 BK. Entire process bank has "refused" to verbally offer any form of settlement. They DO negotiate, had a 15 minute phone call with them a couple weeks back. However, they feel at auction they can get more $$$ for the car then my $4,000 offer. Asked them for their best offer, they refused.

                      So, at this point will likely file the Motion to Redeem. Based on the evidence provided, written documentation would think $4,000 seems reasonable. In all sincerity, I don't know if the judge would agree to my offer or what dollar amount. This has been the sticking, dollar cost as a settlement with Wells Fargo or the dollar amount the BK judge will approve, Section 722.
                      Last edited by 1richard1; 06-14-2011, 10:10 AM.


                      • #12
                        The BK law firm was paid a total of $2,000, included their legal fees along with the court fees too. This does not include any extra legal services like filing the motion. However, $995 seems rather steep to file a Motion to Redeem. My assumption is because the attorney would need to put forth time, effort in preparing himself as to communicating back and forth with the bank. Also, he'd attend the Section 722 Motion to Redeem hearing too.


                        • #13
                          It does not matter what "you" THINK the value is. It is up to the Judge to decide based on the evidence. The only way to get this valuation, is to file a Motion to Redeem Collateral and to appear before the Judge in an evidentiary hearing. In that hearing, each party will provide "evidence" as to the value of the vehicle. The Judge then makes a ruling on what the value is.

                          You can, at that time, decide that the valuation is not what you want and "surrender" the vehicle.

                          I believe that you went about this entirely the wrong way. In a bankruptcy, you don't "negotiate" the value of a piece of collateral with the creditor. You either file a "Motion to Determine Secured Value" or a "Motion to Redeem" (if it's a redemption issue). I believe that you're trying to "bootstrap" a negotiation on value, and that's entirely not now it works. I believe that the reason you are here, at this point, is because you don't want to pay your attorney approximately $1K in fees to pursue the Redemption. Instead, you tried to "negotiate" with the Bank. I believe that you wasted your time doing this.

                          (I will add that filing the Motion to Redeem and listing what you feel is the value, based on attached documentation, is a starting point. Then, and only then, do you work on a stipulated agreement on the value with the creditor. The key is that the creditor "knows" that the court will determine the value short of a stipulated agreement. This is the only procedural way to be successful at this.)
                          Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
                          Status: (Auto) Discharged and Closed! 5/10
                          Visit My BKForum Blog: justbroke's Blog

                          I am not an attorney. Any advice provided is not legal advice.


                          • #14
                            Over the last month my BK attorney was against filing a Motion to Redeem. He said based on the engine damage, ceased motor to simply surrender the car. Further, in my questions asked him about redemption the answers provided were more or less that the bank would decide upon a dollar amount, settlement agreement. In speaking with my attorney, he said it was ok for me to negotiate with the bank by phone. I inquired with him about doing this, also kept him informed by phone conversations and email over the last month, once vehicle engine ceased, which transpired after the 341 hearing, 37 days ago.

                            I do understand and agree entirely, the value is not what I think, nor what the bank thinks as they've refused a settlement. The FMV would be 100% up to the discretion of the BK judge. Based on the factors provided, any idea as to what the judge would determine the value to be? $14,750 est. FMV yet documentation provided with over $11,000 for engine repair costs. (Engine, parts, labor, CA sales tax). I truly have no idea if the judge would stick with the $14,750, the $4,000 or somewhere in the middle. My attorney would not provide me any input on this, once asked. Just to pay him the $995 fee and he could not make any promises, nor elaborate.


                            • #15
                              I'm now see why your attorney wanted nothing to do with this. (If you haven't noticed, the attorney "punted" and basically told you to go deal with the bank.) With a ceased motor, why do you even want a car that would require, based on your posting, $11K of work? This is what we call a "no brainer" in the Bankruptcy world. That is, it's a "no brainer" to surrender the vehicle. If you have $7K laying around somewhere, or even $4K... go purchase a comparatively "decent" beater car and drive that for a year. Save your money and then get a more substantial vehicle if your budget allows it.

                              I have read many stories here on BKForum where debtors are trying desperately to save a home that is underwater. Here, you are trying to save a vehicle that just isn't worth it. I would take whatever emotion there is, out of this equation, and let the car go.

                              It is true that your attorney is paid for his work (hours billed). I'm guessing, again, that you paid very little for your Chapter 7 (less than $2K no-look fee), and any other services were not covered. If you believe that the vehicle is really only worth $4K and the balance is $14K, maybe spending $1K on attorney fees to prosecute a Motion to Redeem, is worth it. However, I just don't see any value in this at this point.
                              Last edited by justbroke; 06-14-2011, 02:11 PM.
                              Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
                              Status: (Auto) Discharged and Closed! 5/10
                              Visit My BKForum Blog: justbroke's Blog

                              I am not an attorney. Any advice provided is not legal advice.


                              Unconfigured Ad Widget